An online petition calling for a day off for these festivals celebrated by Britain's Hindu and Muslim communities attracted 121,843 signatures and was passed on to the House of Commons Backbench Business Committee responsible for scheduling debates on e-petitions that crossed 100,000.
The Department for Business, Innovation and Skills has now provided its decision on the issue, ruling out any further public or bank holidays, as they are known in the UK.
"Whilst we appreciate a new national holiday may benefit some communities and sectors, the cost to the economy remains considerable and any changes to the current arrangements would not take place without a full consultation," the statement said.
"We are very aware of the importance of these festivals which are widely celebrated in the UK. The government is committed to bringing people together in strong, united communities. We encourage and support people to have shared aspirations, values and experiences," the statement added.
"Festivals such as Eid and Diwali contribute to this objective. We regret however that we cannot agree to create new bank or public holidays to mark these festivals," it said.
"The government regularly receives requests for additional bank and public holidays to celebrate a variety of occasions including religious festivals. However the current pattern is well established and accepted," it added.
The e-petition titled 'Make Eid & Diwali Public Holidays' on the UK government website had sparked widespread debate across online chat forums, especially those aimed at British Muslims and Hindus. Many religious and community leaders had however, distanced themselves from the idea.
Vinod Popat, chairman of The British Hindu Voice said, "I don't think it is a very good idea. How many festivals are there for other religions. Should they all be marked with a public holiday The country would grind to a halt."
The petition, created by Jon Timmis, said, "Given the number of Muslims and Hindu's in this country it is only fair that we allow them to have the most important days in their faiths recognised in law.
By giving them public or bank holidays for these days we would be going some way to help to recognise the importance of these faiths to many within the country."
In contrast, a counter-petition titled 'Do Not Make Eid and Diwali Public Holidays' received just 35 signatures.